Final answer:
Most people qualify for a state pension from the government at retirement age, which is currently set to gradually increase to 67 for those born after 1959. Social Security is the main form of retirement income for many Americans and is of great importance as health care costs rise and savings dwindle with age.
Step-by-step explanation:
Most people qualify for a state pension paid by the government upon reaching retirement age. In the United States, the Social Security Administration provides these benefits, with around 46 million retired workers receiving them. This is particularly crucial as Social Security is the main source of income for 12 percent to 40 percent of retirees, and keeping millions out of poverty.
The concept of retirement, which is withdrawing from paid work at a certain age, took shape after significant historic shifts such as the post-American Civil War and the availability of Social Security following World War II. The Social Security program, often characterized as an entitlement, allows American workers to claim pension after completing a minimum number of years of work and reaching the retirement age—originally set at 65 but now gradually increasing to 67 for those born after 1959.
However, the system faces challenges, primarily due to the increasing number of retirees and a smaller workforce contributing to the fund. This has led to warnings about the program's financial sustainability, and past measures have included raising the retirement age and increasing payroll taxes. Future adjustments may include further increasing the retirement age to maintain solvency.
It's important to note that the value of these benefits can be affected over time by factors such as inflation, which particularly impacts those with fixed incomes like private pensions. Additionally, benefits may also be extended under certain circumstances to the survivors of qualifying workers, such as spouses and dependent parents.